May 24, 2017

When we think of innovation, we usually think of Silicon Valley, not the shipping corridors of Europe. The data, however, paints a different picture: according to Eurostat, the EU’s statistics organization, venture capital investment in Europe amounts to €35-40 billion every year. And almost half of all EU enterprises reported some form of innovation activity between 2012 – 2014.

Moritz Dausinger, founder of Paris-based Docparser, is part of Europe’s tech boom. His mission? Taking traditional industries around the world on a journey of digital transformation. Originally a researcher, Dausinger quickly moved into building and growing B2B tech startups. In 2014, his company launched Mailparser, an email parsing program that automatically extracts data from messages. Docparser, their second offering, aims to transform unstructured information from documents into easy-to-handle structured data. With two apps successfully launched, Dausinger offers his take on breaking into tech-averse industries, creating new products, and the future of automation in Europe.

KRISTINE COLOSIMO: Obviously Docparser deals with documents and Twilio just recently released a fax API, which further validates the idea of automating businesses that are very paper-based, like local pizza shops. How are you seeing businesses use physical or digital documents in more traditional industries?

MORITZ DAUSINGER:Orders, faxes, or snail mail.

Even online businesses may still have paper processes. For example, a wholesaler and an online store. The store owner orders the same kind of products on a regular basis from a handful of wholesalers. Those orders are usually transferred in the form of PDF purchase orders–in some cases, even by fax or snail mail. The wholesalers must then extract information about the ordered products from incoming documents and update their internal ERP systems. Similarly, the online store needs to extract key data from vendor invoices and update its accounting system accordingly.

KC: How did you realize people needed a tool like Docparser?

MD: Fulfilling a need.

Docparser evolved out of our original product, Mailparser, which launched in 2014. Mailparser is all about extracting data–leads, ecommerce orders, reports–trapped inside incoming e-mails and moving it to where it belongs, whether that’s in Excel or in another app. While growing Mailparser, we noticed an increasing demand for extracting data from PDF files.

Though it is a similar function in theory, Mailparser could not perform that task, so we couldn’t simply supplement or rebrand the original technology. The use cases and the technology are quite different. To me, the choice was clear: to truly provide the most powerful, user-friendly tools, we had to develop a separate product dedicated to PDFs.

One year after launch, we had hundreds of businesses around the globe using Docparser to extract data from transactional documents like invoices and purchase orders. It’s the natural successor of Mailparser.

KC:What is the most important lesson you’ve learned in your time in the tech/startup space?

MD:Know your customers — and your limits.

Getting feedback from potential users is so important. If you don’t want to launch with a half-baked product, you need to at least talk to potential customers while developing your ideas. Otherwise, you’re in unknown territory, and you’re pursuing things that may seem to make sense but aren’t things people actually want.

The most challenging part for us was to identify use cases which match both our vision and technical capabilities.

We used Docparser’s initial launch to get feedback and then applied that knowledge to improve the product. The most challenging part for us was to identify use cases which match both our vision and technical capabilities. Both of our products can in theory be used for a variety of use cases. But some use cases are technically challenging or do not make sense economically.

KC:Not all industries are moving at the same pace, either owing to lack of motivation/necessity or to technological challenges. How does Docparser enable digital transformation in industries that have yet to embrace it?

MD:Solve an existing problem.

Moving data automatically from A to B is an indispensable requirement in today’s fast-paced work environment. Integration platforms like Workato are a good solution for moving information within an organization. But things are much more complicated when it comes to automatically exchanging data between companies. Most of the time, trading partners don’t have a fully automated way of exchanging transactional data.

This reality is especially painful for small and medium-sized businesses, where invoices, purchase orders, and delivery orders arrive in various formats. Email, PDF documents, faxes, even snail mail–this data then needs to move into your ERP or warehouse system. At the same time, you want to avoid manual data entry, because it’s a time-consuming, error-prone, and expensive process.

The problem isn’t that data exchange standards don’t exist; EDI, for example, has existed for decades. But these solutions are costly to implement, so smaller businesses tend not to use them. Docparser was born as a lower-cost alternative. We allow companies across different industries to easily convert un- and semi-structured documents into structured data. Once it’s extracted, they can move the data to any internal software in real-time, thanks to different export options and API integrations.

KC:What is your advice for people trying to get SMBs into the digital age?

MD:Know your options.

Gradually automating your paper-based processes is less disruptive and you immediately gain productivity.

If you want to digitize your paper-based business processes, you have basically two options: the first option is make the move to a full-fledged ERP and procurement system. But this route involves changing the way you operate, as well as high upfront cost and a risk of failure. Additionally, all your trading partners need to agree on a standard which you use to exchange transactional data (e.g. EDI). The other option is to gradually automate existing business processes with solutions like Workato and Docparser. Gradually automating your paper-based processes is less disruptive and you immediately gain productivity.

KC:What is the most exciting/promising development in your field?

MD: Artificial intelligence.

A majority of today’s data extraction systems are still ‘rule based,’ and the user needs to manually train the software. Data extraction and pattern recognition is one of the fields where artificial intelligence (AI) and machine learning will definitely flourish. At Docparser we are gradually adding more advanced pattern recognition methods. For example, Docparser can extract the totals (net, tax, total) from an invoice without prior knowledge of the language and format of the document.

KC: What do you predict for Europe’s future as far as cloud adoption and automation?

MD:Increased adoption and eventual standardization.

I think cloud based applications–in particular, Software-as-a-Service (SaaS)–will continue to see increased adoption rates amongst businesses of different sizes. When it comes to automation, the procurement space is seeing significant change in Europe right now. For example, the Dutch government has mandated XML/UBL based e-Invoicing for all contracts signed after January 1, 2017 in response to an European Directive (2014/55/EU). Having a standardized digital exchange of invoices across Europe will definitely be a huge time-saver and boost productivity — if software vendors rise to the challenge and support those emerging standards.

KC: How can automation and integration enhance Docparser?

MD:The use cases are endless.

Docparser is all about integrations with other platforms. Our vision is to focus on making data available in a useable form. Thanks to platforms like Workato, the use cases are endless; extracted data can be used in so many ways.

Ready to scale your document mountain? Workato and DocParser can automate the movement of data from your PDFs to your apps like QuickBase, Google Sheets and more.